How to Get New Energy Systems Without Spending a Dime

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Challenge

Beaufort is a small island town of 14,000 near Hilton Head, attracting hundreds of thousands of visitors each year for its scenic beaches, quiet culture, and historic architecture. It has limited resources to transition to more modern and efficient energy systems, but knows it needs them.

Solution

The city negotiated an “energy savings performance contract,” a finance vehicle that uses cost savings from reduced energy consumption to repay the cost of installing conservation measures.

Beaufort selected Johnson Controls, an energy service contracting company, to analyze existing systems, and determined that with some upgrades, the city could achieve a guaranteed savings of37.5% on utility costs (about $1.3 million annually) over a 15-year period. The savings are being used to fund projects like installing new HVAC and solar, groundwater pumps for irrigation, and backup generators for critical infrastructure.

As a result, Beaufort is currently getting $2 million in capital improvements with no increase in its annual budget because energy savings service contracts are revenue neutral. Johnson Controls is retrofitting all city buildings, and also helped create an arrangement with the local energy cooperative where the city gets paid for the solar it produces and charged a cut rate for its energy use.

Lessons Learned

“If a program is going to succeed, you have to have someone who is dedicated to that project,” Neal says. “You can’t just sign a contract and hope it works itself out.”

Neal’s Background

Born in Oak Forest, IL, where he grew up playing baseball (and yes, he’s a Cubs fan). Undergrad in communications at Eastern Illinois University in Charleston (’86) followed by master’s in national strategic studies from the Naval War College (’10) in Rhode Island. Spent 30 years in Marine Corps, retiring last year as a colonel and director of operations for Paris Island. Loves to run and is a big outdoor person. Married with 12-year-old son.

Neal’s Job

Joined the City of Beaufort in September 2016. In addition to the energy savings project, he also manages a $33 million road project, and public works and facilities as well as emergency management.

Startling Fact

“I am not an engineer but am responsible for a significant amount of engineering projects.”